Global Agricultural Trade and Developing Countries

Global Agricultural Trade and Developing Countries

Synopsis

Global Agricultural Trade and Developing Countries presents research findings based on a series of commodity studies of significant economic importance to developing countries. The book sets the stage with background chapters and investigations of cross-cutting issues. It then describes trade and domestic policy regimes affecting agricultural and food markets, and assesses the resulting patterns of production and trade. The book continues with an analysis of product standards and costs of compliance and their effects on agricultural and food trade. The book also investigates the impact of preferences given to selected countries and their effectiveness, then reviews the evidence on the attempts to decouple agricultural support from agricultural output. The last background chapter explores the robustness of the global gains of multilateral agricultural and food trade liberalization. Given this context, the book presents detailed commodity studies for coffee, cotton, dairy, fruits and vegetables, groundnuts, rice, seafood products, sugar, and wheat. These markets feature distorted policy regimes among industrial or middle-income countries. The studies analyze current policy regimes in key producing and consuming countries, document the magnitude of these distortions and estimate the distributional impacts - winners and losers - of trade and domestic policy reforms. By bringing the key issues and findings together in one place, Global Agricultural Trade and Developing Countries aids policy makers and researchers, both in their approach to global negotiations and in evaluating their domestic policies on agriculture. The book also complements the recently published Agriculture and the WTO, which focuses primarily on the agricultural issues within the context of the WTO negotiations.

Excerpt

M. Ataman Aksoy and John C. Beghin

In recent years, agricultural protection and its impact on developing countries have attracted growing attention. While manufacturing protection has declined worldwide following substantial reforms of trade policies, especially in developing countries, most industrial and many developing countries still protect agriculture at high levels. Agricultural protection continues to be among the most contentious issues in global trade negotiations, with high protection in industrial countries being the main cause of the breakdown of the Cancun Ministerial Meetings in 2003.

Why Highlight Agriculture?

What happens in the global agricultural market is important for developing countries beyond the price changes triggered by global reforms. For countries with a small urban population, increasing agricultural exports can accelerate growth more than expanding domestic market demand can. Although food production for home consumption and sale in domestic markets accounts for most agricultural production in the developing world, agricultural exports and domestic food production are closely related. Export growth contributes significantly to the growth of agriculture overall by generating cash income for modernizing farming practices. For those leaving the farm, growth and modernization of agriculture create jobs in agricultural processing and marketing, as well as the expansion of other nonfarm jobs.

Although most successful developing countries have not relied on agriculture for export expansion and growth, growth in agriculture has a disproportionate effect on poverty because more than half of _ the populations in developing countries reside in rural areas and poverty is much higher in rural areas than in urban areas. Some 57 percent of the developing world’s rural population lives in lowermiddle-income countries, and 15 percent lives in the least-developed countries. Even though historical trends show that agriculture’s importance diminishes over time and the share of population in rural areas declines, there will still be more poor people in rural areas than in cities for at least a generation.

Why This Book?

This book explores the outstanding issues in global agricultural trade policy and evolving world production and trade patterns. Its coverage of agricultural trade issues ranges from the details of cross-cutting policy issues to the highly distorted agricultural trade regimes of industrial countries . . .